Alabama still taxes groceries. Could that soon change?

Alabama is one of a small number of states that still tax groceries. Still, the issue is gaining new attention as lawmakers and candidates push to eliminate the remaining state tax. 

The state has already reduced its grocery tax from 4% to 2%. Now with the 2026 election underway, candidates from both parties are calling for the tax to go away entirely.

Does Alabama tax groceries?

Yes, Alabama currently charges a 2% state sales tax on qualifying groceries, down from 4% before a series of reductions approved by lawmakers.

The rate fell to 3% in 2023 and to 2% in 2025. Local sales taxes can still apply, so eliminating the state tax would not necessarily mean shoppers stop paying all sales taxes on food.

Alabama also temporarily suspended the state grocery tax for May and June 2026. That tax holiday ended June 30, returning the state rate to 2% on July 1.

Which states don’t tax groceries?

Most states do not impose a state sales tax on groceries.

As of Jan. 1, 2026, Tax Foundation data showed that 41 states exempt groceries from their state sales taxes. Five of those states—Alaska, Delaware, Montana, New Hampshire, and Oregon—do not have a statewide sales tax at all.

States generally exempt ordinary groceries while treating other food purchases, such as prepared meals, differently. Local taxes can also affect what customers ultimately pay.

Which states still tax groceries?

Only a handful of states continue to impose a state-level tax on groceries.

As of 2026, those states include Alabama, Hawaii, Idaho, Mississippi, Missouri, South Dakota, Tennessee and Utah, although the rates vary.

Why is Alabama’s grocery tax a campaign issue?

The grocery tax has become a bipartisan issue in Alabama’s 2026 campaign.

Republican lieutenant governor nominee John Wahl and Democratic nominee Phillip Ensler have both called for eliminating the remaining state grocery tax.

Democratic gubernatorial nominee Doug Jones has also made repeal part of his campaign platform.

Republican gubernatorial nominee Tommy Tuberville has backed eliminating the grocery tax as part of his broader tax-cutting message.

The bipartisan attention represents a shift from earlier attempts re repeal the tax, which faced disagreements over how the state would replace the lost revenue.

How much could Alabama families save?

The savings would depend on how much a household spends on taxable groceries.

At the current 2% state rate, eliminating the state portion would mean roughly:

$2 saved on $100 in taxable groceries

About $120 a year for a household spending $500 a month on taxable groceries

Local taxes could still apply.

Why hasn’t Alabama eliminated the grocery tax?

The biggest issue is revenue.

The grocery tax generates revenue for the state, including funds that support Alabama’s Education Trust Fund. Eliminating the remaining 2% would require lawmakers to determine how to account for the lost revenue.

For now, Alabama shoppers continue to pay a 2% state tax on qualifying groceries, along with applicable local taxes.

With grocery-tax repeal now a talking point for candidates in both parties, the issue could return to the Alabama Legislature after the 2026 election.

Lawmakers will face the question of whether to eliminate the state’s remaining grocery tax and how to account for the revenue if they do.

Jennifer Lindahl is a Breaking and Trending Reporter in Alabama for USA TODAY’s Deep South Connect Team. Connect with her on X @jenn_lindahl and email at  jlindahl@usatodayco.com.

This article originally appeared on Montgomery Advertiser: Alabama still taxes groceries. Could that soon change?